Gift cards take centre stage this Christmas: Australian shoppers to spend nearly half of gift budget on flexible presents
This holiday season, gift cards are emerging as the star of Christmas stockings nationwide. According to new research from global branded payment provider, Blackhawk Network (BHN), Australian shoppers plan to allocate nearly half (44%) of their total gift spend on gift cards, up from 40% last year.
BHN found that Australians plan to spend an average of AUD$707 on gifts this holiday season, with AUD$311 earmarked for gift cards. While shoppers across all generations plan to spend more on gift cards this year, the largest increase is among younger shoppers. Gen Z and Millennial consumers plan to spend almost half of their total holiday gift spend (45%) on gift cards, an increase from 39% last year.
Shifting perceptions and spending habits
The shift marks a significant change in perception, as gift cards are increasingly seen by consumers as a thoughtful and intuitive gifting choice which recognises the value of giving recipients the freedom to select their own perfect present. In fact, over 51% of survey respondents noted that gift cards let recipients choose a gift they truly wanted, while also being a safer option to gifting cash (35%).
“No one wants to give a bad present that sits unused in a cupboard, regifted, or worse- uploaded to Facebook Marketplace. Gift cards have well and truly evolved from being a convenient option to a primary gifting strategy, which is well supported by the wide variety of gift cards available in the market. In today’s fast-paced world, where trends come and go at lightning speed, gift cards offer a perfect solution, allowing recipients to stay current with their choices while reducing the stress of gift selection for givers,” said BHN Senior Director Retail Kieran Nolan.
Gift cards are also topping Christmas wish lists with 84% of people wanting to receive gift cards, up from 60% last year. With trend cycles accelerating in recent years, traditional gifts risk becoming outdated quickly, making gift cards an increasingly attractive option.
Other key findings from BHN’s research include:
‘Tis the season for micro gifting
For many, the holiday season goes beyond building up to one day or week of the year and is instead a series of opportunities to show gratitude and celebrate the season with the many people that touch their lives. Between family, friends, coworkers, teachers and service workers, the number of gift-giving occasions is increasing, particularly among Gen Z, who are twice as likely as Baby Boomers to be attending holiday gift exchanges with friends.
Younger generations report planning to purchase almost double the gift cards this year than older generations, likely to account for the difference in number of holiday gift exchanges. Younger surveyed shoppers plan to purchase a total of 21 gift cards this holiday season (9 physical and 12 digital), while older generations plan to purchase 10 gift cards (6 physical and 4 digital).
“As the holiday season approaches, retailers should be preparing for a surge in gift card demand by expanding their in-store and online offerings,” said Nolan.
“Shoppers are set to adopt a more strategic approach to their holiday spending as they balance rising living costs with value-driven gifting. Business should consider investing in their loyalty and incentive programs during the period to ensure they are engaging with customers and creating positive shopping experiences.”
Loyalty programs are powering holiday spending
Cost of living pressures continue to persist for many Australians. BHN research shows that inflation and grocery/food prices remain a primary concern for consumers. Forty-six percent of surveyed consumers said they plan to change their shopping behaviours, with a key focus on value and deals this holiday.
For many consumers, loyalty programs with stored value that they have built up will serve as a digital couch cushion this holiday season, helping shoppers find some extra spending power—especially for younger generations. Of the surveyed Gen Z and Millennial consumers, 18% plan to pay for holiday gifts with store or credit card points and 13% plan to purchase gifts using loyalty points (i.e., hotel, airline, etc.).
For more findings and actionable insights to maximise the holiday shopping season, download BHN’s Australian holiday 2024 shopper and gift card insights here.
